PEY - PEY: Pass Due To Bad Exposure And High Fees

2024-02-14 09:45:59 ET

Summary

• Invesco High Yield Equity Dividend Achievers ETF faces risks due to a lack of diversification, bad exposure, underperformance compared to peers, and a high comparative fee structure.
• PEY's strategy focuses on high dividend-yielding stocks with a history of increasing dividends, aiming to provide income and potential capital appreciation.
• PEY has significant exposure to Walgreens Boots Alliance, which adds to the fund's vulnerability and warrants caution.

Thesis

The Invesco High Yield Equity Dividend Achievers ETF ( PEY ) is positioned precariously at the hard-to-execute intersection of high-dividend payments and following an index-based strategy. While the ETF's strategy of mirroring the Nasdaq US Dividend Achievers 50 Index offers an attractive proposition through its portfolio of high-yield dividend stocks with a record of growth, this approach is not without its drawbacks....

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